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By Anonymous Mike, pseudonymously.

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Friday, August 17, 2007
The Nadine Dilemma

Earlier in the week I posted about the drop in cigarette tax revenue and its possible linkage to last November's boost in the state tobacco tax that was pushed by Nadine Basha's campaign to get more money for early childhood education. At the end I asked:

So here's the next , next story. If the feds succeed in boosting the federal tax on tobacco, further driving down consumption, and therefore state tobacco tax revenue... what happens to Nadine Basha's early childhood programs?

Well here we go. The Heritage Foundation has published a report on the effects that Congress's proposed tobacco tax to fund an expanded SCHIP (State Children's Health Insurance Program.) Heritage finds that all states would experience a reduction in state tobacco tax dollars as the increased federal tax will depress demand; Arizona will lose an estimated $9.6 to 13.4 million depending on which tax version is implemented. However Arizona will also gain as much as $327 million in net inflow (difference between SCHIP funding minus loss in tobacco dollars.)

So if you are Nadine, do you go for early childhood education or increased child health care?

Ahhh.... the wages of sin.